2015 Session

Budget Amendments - HB1400 (Member Request)

Chief Patron: Davis
Tax Credit for Small Business Owners (language only)

Item 3-5.20 #4h

Item 3-5.20 #4h

Adjustments and Modifications to Tax Collections
Liveable Homes Tax Credit

Page 517, after line 43, insert:
Notwithstanding any other provision of law, for taxable years beginning on or after January 1, 2015, an eligible business shall be allowed a credit against the tax imposed pursuant to § 58.1-320 in an amount equal to the lesser of (i) the product of .0575 and 75 percent of the principal paid on business loans by the eligible business during the taxable year, but not to exceed an aggregate of $3,500 for the year, or (ii) the tax imposed pursuant to § 58.1-320 for the taxable year.
A. Credits granted to a partnership, limited liability company, or electing small business corporation (S corporation) shall be allocated to the individual partners, members, or shareholders, respectively, in proportion to their ownership or interest in such business entities.
B. The Tax Commissioner shall develop guidelines implementing the provisions of this section. Such guidelines shall be exempt from the provisions of the Administrative Process Act (§ 2.2-4000 et seq.)."

(This amendment establishes a new individual income tax credit for the amount of principal paid by an eligible new business on a loan. The credit could not exceed $3,500 per individual or the amount of tax imposed for the year. This language mirrors House Bill 2225 as introduced and is estimated by the patron to cost $120,000 each year.)